Government Plans to Build Dry Ports in Modjo and Mille

12 December, 2007

The Ministry of Transport and Communications (MoTC) will construct two dry ports for lorries and trains with a projected cost of 300 million Br. The Ministry annexed 140hct of land in Modjo and Mille for the facilities, paying four million Birr in compensation to the displaced farmers.

The Mille port will mainly serve the north, northwest and north central regions of the country, while the Modjo port will serve the wide hinterlands of the central, south, southwest and western parts of the country.

“Taking proximity to major East African ports into account, evaluations of major transit corridors were made in order to select an ideal spot that could best facilitate the efficient and cost-effective movement of overland cargo,” Bazezew Baye, director of policy and planning directorate at the MoTC told Fortune.

Bazezew also said that in the future three more dry ports will be constructed in Dire Dawa, Metema and Moyale. Considering the strategic geographic position of Mile and Modjo at key cross-roads and near to sea ports in Djibouti and Somalia, the towns were selected for the first two dry ports.

Major East African ports include the Eritrean ports (Assab and Massawa), the port of Djibouti, port of Somaliland (Berbera), the Somali ports (Port of Mogadishu and Kismayu), Port Sudan and Port of Mombassa.

The ministry stated that 90pc of goods imported to Ethiopia stay at these ports for more than 15 days, often suffering from the elements and accruing fees of 20 dollars each day per tonne.

“The ports are beneficial because imported goods will no longer be affected by the powerful sun and salty land in Djibouti,” Junedin Sado, minister of MoTC told reporters at the Sheraton last week on Wednesday.

The government, however, will not begin construction of the ports this year. Indeed, only 19 million Br has been allocated for the project this year. Of the annual budget, 4 million Br has been spent on compensating land owners. The remaining 15 million Br will be use to construct offices for customs officials as well as for state-owned insurance firms and banks.

Getachew Mengistie, state minister of MoTC told Fortune that the ports would help the country shorten long delays in the customs clearing procedures.

However, custom clearing agents fear that the government may monopolise the clearing of the goods. Getachew Aregay, president of Transistors Association, said that there are plenty of individuals that depend on transiting goods to earn a living.

“The government should not cut out customs middle-men from the clearing procedures,” he said.

Ethiopia also benefits from the installation of the ports, as it will be the Ethiopian government that confiscates goods whose owners do not appear on time, unlike the previous case where the Djibouti government expropriates them. Moreover, it is expected that businesses would flourish in Mille and Modjo towns.

By DAWIT ABABE - FORTUNE STAFF WRITER